$270M pre-foreclosure filed at RFR’s 285 Madison, 9th for owner in 15 months

The servicer for a securitized loan with an original principal of $270 million filed a pre-foreclosure action alleging RFR Holding was in a maturity default on the loan secured by the 407,127-square-foot Grand Central office building at 285 Madison Avenue. This is the ninth commercial foreclosure filed against an RFR Holding commercial building since October 2023.

RFR Holding and its principals Abby Rosen and Michael Fuchs have also been the defendants in a number of money judgment cases, including one that was related to a $205 million, 2017 mezzanine and junior mezzanine loan package secured by an equity interest in this building. PincusCo reported on the case when it was originally filed in May 2024. The case was consolidated with a related action, and both were decided in an October ruling in favor of the mezzanine lender, KTB Asset Management, which was seeking to collect on guarantees Rosen and Fuchs had signed. The judge ruled the RFR heads owed a combined $18.14 million through the guarantees.

Case LINK

Court records represent the position of one party and are not necessarily accurate or complete. Despite these and other financing challenges, RFR Holding remains one of the largest commercial property owners in Manhattan, with at least 18 buildings and 2.8 million square feet of space

RFR Holding and GreekOak (now BentallGreenOak) bought 285 Madison Avenue in 2012 for $189 million. RFR bought out GreekOak for $334 million in August 2016. RFR refinanced the building with a $270 million senior loan through lender Natixis in November 2017, and that debt was securitized into Natixis Commercial Mortgage Securities Trust 2018-285M, Commercial Mortgage PassThrough Certificates, Series 2018-285M, which is the plaintiff in this new action.

RFR Holding of 285 Madison Owner LLC submitted a major alteration application for a $38 million renovation of the 407,127 square-foot commercial (COM) building at 285 Madison Avenue in Grand Central, Manhattan, with the New York City Department of Buildings on June 27, 2013 under job number 121235555 which was permitted on September 9, 2013. It called for a rehab of the 25-story building. The project is described in the filing as: application filed to increase the occupant load on floors 2-25 as well as demolition and general construction modifications taking place in the cellar, mezzanine, penthouse, roof, and floors 1-25 as reflected on the drawings. subsequent mechanical & structural filings will be under this application.

The property

The office building in Grand Central has 407,127 square feet of built space according to a PincusCo analysis of city data. The parcel has frontage of 150 feet and is 175 feet deep with a total lot size of 21,887 square feet. The lot is irregular. The zoning is C5-3 which allows for up to 15 times floor area ratio (FAR) for commercial and up to 10 times FAR for residential with inclusionary housing. The city-designated market value for the property in 2022 is $123.8 million.

Prior sales and revenue

The 407,127-square-foot property generated revenue of $29 million or $71 per square foot, according to the most recent income and expense figures.

Development

For the tax lot building, it received its initial renovation certificate of occupancy on May 14, 2015.

Violations and lawsuits

According to city public data, the property has received $3,200 in OATH penalties in the last year.

The property was involved in two lawsuits and zero bankruptcies over the past two years. The highest value suit was a $16.6 million money judgment concerning a loan filed on May 29, 2024, by KTB Asset Management against RFR Holding, Aby Rosen, and Michael Fuchs.

The neighborhood

In Grand Central, The majority, or 83 percent of the 44.4 million square feet of commercial built space are office buildings, with hotel buildings next occupying 8 percent of the space. In sales, Grand Central has near average sales volume among other neighborhoods with $956.6 million in sales volume in the last two years and is the 10th highest in Manhattan. For development, Grand Central is the 6th most active neighborhood among other neighborhoods. It had 5.8 million square feet of commercial and multi-family construction under development in the last two years, which represents 13 percent of the neighborhood’s built space.

The block

On this tax block, PincusCo has identified the owners of 10 of the 19 commercial properties representing 2,365,691 square feet of the 2,731,781 square feet. The largest owner is 60 Guilders, followed by APF Properties and then Diamondrock Hospitality Company. There are no active new building construction projects on this tax block.

The owner

The PincusCo database currently indicates that RFR Holding owned at least 18 commercial properties in New York City with 2,850,407 square feet and a city-determined market value of $1.1 billion. (Market value is typically about 50% of actual value.) Within the portfolio, the bulk, or 87 percent of the 2,850,407 square feet of built space are office properties, with hotel properties next occupying 8 percent of the space. The bulk, or 96 percent of the built space, is in Manhattan, with Brooklyn next at 4 percent of the space.

The surrounding

Within a 400-foot radius of 29 East 40 Street, PincusCo identified four commercial real estate items of interests occurred over the past 24 months. One of those four items was a sale which Sentry Realty and 60 Guilders bought the 170,230-square-foot, 26-unit office building (O4) on 292 Madison Avenue for $90.5 million from Vanbarton Group on November 12, 2024. Of those four items, three were loans above $5 million totaling $506.2 million. The most recent of the three was SL Green Realty in which borrowed $423 million from Aareal Capital secured by the 778,203-square-foot, one-unit office building (O4) on 100 Park Avenue on December 9, 2024.

Direct link to the property’s ACRIS page and link to DOB NOW portal.